During my career, I've seen several approaches to regular performance reviews. I've also tried several approaches from my side and I'm right now up to a huge experiment with my teams.
Besides one company where I've worked, all companies had some way of regular performance reviews. It's usually not the most enjoyable task, but when there was none, there was also no dedicated time and no willingness to look back and evaluate. Furthermore, the year is just too long time to look back. So my recommendation is to make it regular, mandatory and often (each 3 to 6 months).
There's a question of whether any regular review should somehow affect any kind of bonuses or promotions. I used to say "yes, that makes sense" until I once tried the opposite. Suddenly, people became way more honest during feedbacks. It's simply way easier to share a problem with your manager or peer when there's no expected punishment for anyone. Reducing bonuses (or even a chance of reducing) is a punishment for my colleague, whom I have to meet regularly! Even more surprising was sudden openness between me and my peers - we didn't hesitate to share tips and issues through the management group as there was no risk of reducing anyone's reward.
Personally, I highly recommend not to connect KPIs or OKRs to the bonuses as well. Choose any number of the KPIs, spend bambolleon hours in discussions, prepare the tools and visualization of your metrics and at the end of the day, the results will match expected thresholds. Unfortunately, without any relation to reality or even real improvements.
The third devil is hidden in your relationship with each and every individual in your team. You can't expect honest feedback for his team if you're meeting them once per quarter. You need to stick around, provide help and guidance - and let's put aside the question, whether a manager should be also an expert in a given field. If you're not having regular 1-1s with your team members, it's too late to get back on the track at the end of the evaluated period. And don't even try to do the evaluation without knowing his peers' attitude. You're not working with the evaluated one on a daily basis; they are.
If you want to get your job half-done even before you'll start, ask your colleagues for self-evaluation as your first step. You'll not forget any achievement or proud moments. You'll get their standpoints of things where you mutually agree an improvement is required. Mainly, you can get prepared for the situations where an employee is well satisfied with his results and expects appraisal, but your expectations were higher.
Finally, your team deserves an excellent performance from your side. Get ready, prepare your speech, prepare the key points. Share both successes and areas for improvement, show the long term trends using previous performance reviews (yes, that may require to keep the records). Be open to a discussion and be prepared for denials. You may need to quickly react to unexpected twists, but stay firm in your rules and requirements.
The last paragraph will not relate that much to this article. I've mentioned the huge experiment at the beginning of this article. Due to ongoing changes in my employer, my teams will soon have to deliver performance reviews without any aid from a manager. So we agreed to try it right away. Stay tuned, I'll share my impressions.